July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Alabama

cc: Alabama Congressional Delegation

Alabama Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Alabama is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations;

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Alaska

cc: Alaska Congressional Delegation

Alaska Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Alaska is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Arizona

cc: Arizona Congressional Delegation

Arizona Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Arizona is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans.

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Arkansas

cc: Arkansas Congressional Delegation

Arkansas Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Arkansas is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- California

cc: California Congressional Delegation

California Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-California is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Colorado

cc: Colorado Congressional Delegation

Colorado Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Colorado is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Connecticut

cc: Connecticut Congressional Delegation

Connecticut Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Connecticut is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Delaware

cc: Delaware Congressional Delegation

Delaware Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Delaware is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Florida

cc: Florida Congressional Delegation

Florida Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Florida is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Georgia

cc: Georgia Congressional Delegation

Georgia Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Georgia is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Hawaii

cc: Hawaii Congressional Delegation

Hawaii Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Hawaii is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Idaho

cc: Idaho Congressional Delegation

Idaho Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Idaho is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Illinois

cc: Illinois Congressional Delegation

Illinois Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Illinois is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Indiana

cc: Indiana Congressional Delegation

Indiana Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Indiana is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Iowa

cc: Iowa Congressional Delegation

Iowa Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Iowa is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Kansas

cc: Kansas Congressional Delegation

Kansas Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Kansas is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Kentucky

cc: Kentucky Congressional Delegation

Kentucky Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Kentucky is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Louisiana

cc: Louisiana Congressional Delegation

Louisiana Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Louisiana is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Maine

cc: Maine Congressional Delegation

Maine Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Maine is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Maryland

cc: Maryland Congressional Delegation

Maryland Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Maryland is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Massachusetts

cc: Massachusetts Congressional Delegation

Massachusetts Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Massachusetts is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Michigan

cc: Michigan Congressional Delegation

Michigan Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Michigan is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan,

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Minnesota

cc: Minnesota Congressional Delegation

Minnesota Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Minnesota is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Mississippi

cc: Mississippi Congressional Delegation

Mississippi Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Mississippi is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Missouri

cc: Missouri Congressional Delegation

Missouri Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Missouri is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Montana

cc: Montana Congressional Delegation

Montana Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Montana is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
Nebraska

July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Nebraska

cc: Nebraska Congressional Delegation

Nebraska Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Nebraska is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
Nevada 

July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Nevada

cc: Nevada Congressional Delegation

Nevada Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Nevada is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
New Hampshire

July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- New Hampshire

cc: New Hampshire Congressional Delegation

New Hampshire Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-New Hampshire is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- New Jersey

cc: New Jersey Congressional Delegation

New Jersey Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-New Jersey is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- New Mexico

cc: New Mexico Congressional Delegation

New Mexico Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-New Mexico is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- New York

cc: New York Congressional Delegation

New York Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-New York is one of the 50 state associations forming the National Association of Insurance and

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- North Carolina

cc: North Carolina Congressional Delegation

North Carolina Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-North Carolina is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- North Dakota

cc: North Dakota Congressional Delegation

North Dakota Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-North Dakota is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Ohio

cc: Ohio Congressional Delegation

Ohio Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Ohio is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Oklahoma

cc: Oklahoma Congressional Delegation

Oklahoma Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Oklahoma is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans.

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Oregon

cc: Oregon Congressional Delegation

Oregon Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Oregon is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Pennsylvania

cc: Pennsylvania Congressional Delegation

Pennsylvania Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Pennsylvania is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Rhode Island

cc: Rhode Island Congressional Delegation

Rhode Island Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Rhode Island is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- South Carolina

cc: South Carolina Congressional Delegation

South Carolina Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-South Carolina is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- South Dakota

cc: South Dakota Congressional Delegation

South Dakota Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-South Dakota is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Tennessee

cc: Tennessee Congressional Delegation

Tennessee Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Tennessee is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Texas

cc: Texas Congressional Delegation

Texas Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Texas is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Utah

cc: Utah Congressional Delegation

Utah Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Utah is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Vermont

cc: Vermont Congressional Delegation

Vermont Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Vermont is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Virginia

cc: Virginia Congressional Delegation

Virginia Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Virginia is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 
NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:

• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.
ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.

The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Washington

cc: Washington Congressional Delegation

Washington Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Washington is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- West Virginia

cc: West Virginia Congressional Delegation

West Virginia Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-West Virginia is one of the 50 state associations forming the National Association of Insurance 

and Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations 

representing the interests of insurance professionals from every Congressional district in the United 

States. NAIFA members assist consumers by focusing their practices on one or more of the following: 

life insurance and annuities, health insurance and employee benefits, multiline, and financial advising 

and investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement.
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Wisconsin

cc: Wisconsin Congressional Delegation

Wisconsin Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Wisconsin is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement. 
July 15, 2015

To: The Honorable Thomas E. Perez

Secretary of Labor

From: NAIFA- Wyoming

cc: Wyoming Congressional Delegation

Wyoming Insurance Commissioner

Re: Department of Labor (RIN 1210-AB32)

NAIFA-Wyoming is one of the 50 state associations forming the National Association of Insurance and 

Financial Advisors (NAIFA) federation, one of the nation’s oldest and largest associations representing 

the interests of insurance professionals from every Congressional district in the United States. NAIFA 

members assist consumers by focusing their practices on one or more of the following: life insurance 

and annuities, health insurance and employee benefits, multiline, and financial advising and 

investments. NAIFA’s mission is to advocate for a positive legislative and regulatory environment, 

enhance business and professional skills, and promote the ethical conduct of its members.

NAIFA members have been helping clients achieve financial security for 125 years. They serve primarily 

middle-market clients, including individuals and businesses. In some cases, our members serve areas 

with a single financial advisor for multiple counties. And often, our members’ relationships with their 

clients span decades and various phases of clients’ income and retirement planning needs. 

The retirement products most commonly offered by NAIFA members are annuity products (fixed and 

variable) and mutual funds. Some of our members are independent advisors working with independent 

broker-dealers; others are affiliated with (or captives of) product providers and are restricted to some 

degree in the products they are able to sell. 

Virtually all NAIFA members working in the individual IRA space will have to rely on the Department’s 

proposed Best Interest Contract (“BIC”) Exemption, which represents a far more onerous compliance 

regime than any of our members have faced previously. Thus, the proposal portends a dramatic shift in 

the way our members will interact with their clients and conduct their businesses, and a significant 

increase in the cost of conducting their business. NAIFA does not oppose a “best interest” fiduciary 

standard for its members. However, any new standard must be operationalized in a manner that is 

workable for Main Street advisors and their clients. 

NAIFA has significant concerns about the workability of some portions of the Department’s proposed 

rule, and recommends several adjustments to the proposal. Namely, NAIFA strongly encourages the 

Department to adopt a final rule that:
• Allows for sales, marketing, and client development conversations and communications 

between advisors and potential clients without triggering fiduciary status or liability, either 

through a revised definition of “investment advice” or through a more robust seller’s exception;

• Contains a carve-out from the definition of fiduciary investment advice for assistance with small 

plan menu design;

• Allows for meaningful investment education without triggering fiduciary status;

• Allows for reasonable limitations on the duration of fiduciary obligations; 

• Builds upon existing supervisory and regulatory approaches;

• Affirmatively and explicitly states that sales of proprietary or other limited range of products in 

and of itself is not a violation of a best interest fiduciary standard; and

• Does not cover advice or services related to non-cash-value welfare benefit plans, such as 

health, accident, disability, or life insurance products that do not have an investment 

component.

In its current form, the proposed rule presents major—and in some cases, insurmountable—obstacles 

for NAIFA members serving middle-market retail investors (i.e., those who need the most 

encouragement and assistance when it comes to retirement savings). 

Businesses that sponsor retirement savings plans often rely on advisors to help implement the plan, 

design plan features such as auto enrollment to encourage employees to participate in the plan, as well 

as assistance in selecting the investment options available to participants. Affordability is a crucial issue, 

especially for small plans. 

Employees require education on the importance of saving early for retirement, on determining their risk 

tolerance and what investment options are available in their work-place retirement plan. The DOL 

proposal narrowly defines investment education, which will limit the assistance advisors can provide 

without triggering fiduciary obligations.

The proposed rule does not allow an advisor to identify specific investments, even as an example of the 

type or class of investment that meet the employee’s retirement objectives. As such, the rule 

transforms true education into fiduciary advice so early in the process that it would reduce access to 

necessary educational information, and likely result in less savings and riskier choices.

Employees need education and advice when rolling or transferring plan assets to another plan or to an 

IRA, as well as advice on taking distributions from their plan in retirement. The DOL rule, as currently 

drafted, does not allow advisors to receive third party compensation when advising plan participants on 

distribution options. 

Only half of 401(k) plans have systematic withdrawal provisions, and only 15% have an annuity to 

provide guaranteed lifetime income as an investment choice, necessitating the employee roll the plan 

assets to an IRA, where an annuity can be purchased. It is less expensive for the advisor to be paid a 

commission in this circumstance than to pay an on-going asset management fee.

ERISA does not permit investment advice fiduciaries to have conflicts of interest, yet 98% of all IRA 

accounts are served under a commission model that the DOL considers to be conflicted. Therefore, the 

DOL must continue to provide a simple exemption to accommodate third party compensation so that 

these retirement savers are not left to “go it alone” when it comes to investment advice.
The BIC exemption requires a complicated three-party contract that is confusing to retirement savers; 

and it requires the institution to maintain a public website with copious amounts of data and 

information and in a format that may be impossible to accomplish.

The DOL should modify the contract conditions; specifically:

 Eliminate the formal contract requirement and replace it with a non-signatory point-of-sale 

notice that binds advisors and financial institutions to act in the best interest of their clients;

• Or, if the Department retains the contract requirement, clarify:

o that any contract need not be signed prior to the point of sale;

o that the contract need not be signed by more than one financial institution;

o that advisors do not have to provide warranties regarding another entity’s (e.g., a 

financial institution) incentive and compensation arrangements; and, that the contract 

may contain language reasonably limiting the duration of the fiduciary relationship

Thank you for the opportunity to share these concerns and necessary changes to achieve the goal of 

helping American retirees achieve a secure retirement.